H2.6 Userdocumentation FixedAssets

Global Process Management System
User Documentation
Process : F-3 Fixed Assets Fixed Assets
Approval Date: 01.08.2006 Review Date: 01.02.2007
Written By: Ulrike Auleitner Approved By: Lavanya Kavuri
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Fixed Assets
Valid on day of print 18/05/2004 20:01:00 - For internal use only -

9494 Schaan Liechtenstein
Process: F-3 Fixed Assets Fixed Assets

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Content
5 Asset Accounting................................................................................................................................ 4
5.1 Organisation and organisational data........................................................................................... 4
5.1.1 Depreciation Area.................................................................................................................. 4
5.1.2 Chart of Depreciation............................................................................................................. 5
5.1.3 Asset Class........................................................................................................................... 5
5.2 Master Data............................................................................................................................... 10
5.2.1 Asset Master Record........................................................................................................... 10
5.3 Business Processes................................................................................................................... 12
5.3.1 Asset Maintenance.............................................................................................................. 12
5.3.1.1 Create an Asset................................................................................................................ 12
5.3.1.2 Asset Master Record Display...........................................................................................13
5.3.1.3 Asset Master Record Change.......................................................................................... 14
5.3.1.4 Asset Shutdown................................................................................................................ 14
5.3.1.5 Mass Change................................................................................................................... 15
5.3.1.6 Lock Asset........................................................................................................................ 15
5.3.1.7 Delete Asset..................................................................................................................... 16
5.3.2 Asset Acquisitions............................................................................................................... 16
5.3.2.1 Direct Capitalisation.......................................................................................................... 17
5.3.2.2 Capitalise Asset under Construction.................................................................................19
5.3.2.3 Down Payments............................................................................................................... 21
5.3.2.4 Subsequent Acquisition.................................................................................................... 23
5.3.2.5 Post-capitalisation............................................................................................................ 23
5.3.2.6 Credit Memos................................................................................................................... 24
5.3.2.7 Write-up............................................................................................................................ 25
5.3.2.8 Low-Value Assets............................................................................................................. 25
5.3.3 Asset Transfer..................................................................................................................... 26
5.3.3.1 Intra-company Asset Transfer.......................................................................................... 26
5.3.3.2 Inter-company Asset Transfer.......................................................................................... 27
5.3.4 Asset Retirement................................................................................................................. 28
5.3.4.1 Asset Sale with customer................................................................................................. 29
5.3.4.2 Asset Retirement by Scrapping........................................................................................31
5.3.4.3 Subsequent Revenue/Costs.............................................................................................32
5.3.5 Display / Change Document................................................................................................33
5.3.6 Reverse Document.............................................................................................................. 33
5.4 Periodic Processing................................................................................................................... 33
5.4.1 Periodic Posting................................................................................................................... 33
5.4.2 Posting Depreciation............................................................................................................ 36
5.4.3 Fiscal Year Change............................................................................................................. 39
5.4.4 Account Reconciliation........................................................................................................ 39
5.4.5 Year-end Closing................................................................................................................. 40
5.4.6 Insurance Values................................................................................................................. 41
5.4.7 Physical Inventory............................................................................................................... 42
5.5 Reporting.................................................................................................................................... 45
5.5.1 Reports on Asset Accounting..............................................................................................45
5.6 Investment Plan (Budgeting)...................................................................................................... 46
5.6.1 Internal Order...................................................................................................................... 47
5.6.2 Order status......................................................................................................................... 48
5.6.3 Depreciation simulation....................................................................................................... 49
5.6.4 Disinvestments.................................................................................................................... 52


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5.6.5 Availability control................................................................................................................ 52

5.6.6 Budget update..................................................................................................................... 53
5.6.7 Budget conclusion............................................................................................................... 54
5.7 Investment Management............................................................................................................ 55
5.7.1 Integration............................................................................................................................ 55
5.7.2 Components within Investment Management......................................................................56
5.7.2.1 Investment Program......................................................................................................... 56
5.7.2.2 Appropriation Requests.................................................................................................... 57
5.7.2.2.1 Status Management...................................................................................................... 58
5.7.2.2.2 Roll up Plan Values in the Investment Program............................................................59
5.7.2.2.3 Edit Original Budget....................................................................................................... 59
5.7.2.3 Investment Measure......................................................................................................... 59
5.7.2.3.1 Internal Order................................................................................................................ 60
5.7.2.3.1 Order status................................................................................................................... 61
Change-Log
Date Who What Release

24.09.02 Ulli Auleitner Account determination / Naming Convention H2.1
24.09.02 Ulli Auleitner Cash Discount / Net Posting H2.1
24.09.02 Ulli Auleitner Low-Value Assets H2.1
24.09.02 Ulli Auleitner Asset Sale with customer H2.1
24.09.02 Ulli Auleitner Insurance Values / Index series H2.1
07.01.03 Ulli Auleitner Account Reconciliation H2.1
07.01.03 Ulli Auleitner Recalculate Values H2.1
26.11.03 Ulli Auleitner Investment Management H2.4
24.01.05 Ulli Auleitner Asset Sale without customer removed (not H2.6
needed)


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5 Asset Accounting
5.1 Organisation and organisational data
5.1.1 Depreciation Area
Depreciation areas are used to calculate and track different values for each fixed asset
in parallel for different purposes.
The depreciation areas are identified by two-digit numeric keys. The depreciation terms
are entered in the asset class or directly in the asset master record of the particular
asset. This makes it possible for example, to use straight-line depreciation for group
reporting purposes (depreciation area 30) and to use declining-balance depreciation for
tax purposes (depreciation area 02).
Table 1 Depreciation areas

01 book depreciation
02 tax depreciation (local requirements)
03 valuation reserve (local requirements)
20 cost accounting depreciation
30 consolidated balance sheet in local currency
31 consolidated balance sheet in group currency
32 book depreciation in group currency
Asset balance sheet values and depreciation from each depreciation area are posted to
the corresponding general ledger accounts. For book depreciation (01), values are
automatically posted online in Financial Accounting. For cost accounting, depreciation
(20) and consolidated balance sheet in local currency (30), values are posted
automatically at periodic intervals (daily / monthly) to Financial Accounting.
Picture 1 Depreciation areas (saphelp)


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Depreciation areas are grouped in a chart of depreciation according to local

requirements.
5.1.2 Chart of Depreciation

A chart of depreciation is usually country-specific and defined independently of the
other organisational units. The chart of depreciation determines the particular
depreciation areas and depreciation keys that will be used by a company code. Two
organisations within a country must have different charts of depreciation.
The naming convention for a chart of depreciation is as follows:

Total four digits (for example HAT1)
First position is an “H” for Hilti
Second and third position are two letters for the country identifier (AT = Austria)
Fourth position is an ascending number.
5.1.3 Asset Class

Asset classes are used to structure the assets according to local and group
requirements. The asset class provides default values to all asset master records in the
class. In this way, the asset class functions as a sample master record, and makes it
possible to easily create new asset master records.


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The asset class is a selection criteria in all standard reports in Asset Accounting. In
addition, you can also request sorting and totaling by class-specific characteristics.
One of the most important functions of the asset class is to establish the connection
between the asset master records and the corresponding accounts in the general
ledger in Financial Accounting.
Picture 2 Asset classes (saphelp)
Account determination
This connection is created by the account determination key in the asset class.
When posting to an asset, the system determines the G/L account that is posted, based
on four things: the chart of accounts valid in the company code, the depreciation area
that is to be posted, the account allocation key, and the transaction type.


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Picture 3 Account determination

Asset Company Code
CoCd 3051 3051
Asset 86 ...
... Chart of HI10
Class 114000 Accounts ...
...
Asset Class
114000 Account Determination
... Chart of Accounts HI10
Account 114000 114000
Determination ... Depreciation Area 01 30
Balance Sheet Account 5114000 114000
Offsetting Account 290970 290970
....
Accumulated Depreciation 5114009 114009
Depreciation Expense 5470114 470114
....
Retirement Clearing 990005 990005
....
Naming Convention is a 6-digit name

First 3 digits relate to balance sheet grouping (according to the Frango classification)
The 4th digit is a 5 if the class is an asset under construction (AUC). The last two digits
are used for additional, locally required asset classes (stepped up in increments of 10).
These shall still follow the Hilti Finance Manual (G/L accounts). If some organisations
require a further splitting of assets into additional/different asset classes, resulting in
additional G/L accounts, then the local organisation shall define new local asset
classes, using the last 3 digits numbered from 700 to 900.
Example
114000 Handling systems (robots)
114010 Machines for cold forming e.g. edging machines (locally used asset class)
114500 Plant machinery and related equipment under construction (AUC)
112700 Installation buildings (e.g. BE for Belgium)


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Table 2 Asset classes

Intangible fixed assets
100000 Rights Concessions and trading rights
Commercial protection rights
(patents, licenses, brand name rights,
copyrights)
Other rights (rights of use, quotas)
103000 Other intangible assets Software
Major reorganisation projects
Technological applications / inventions
Research and development projects
Other intangible assets
105000 Other intangible assets LVA
106000 Capitalized cost internal project
107000 Goodwill
108000 Company organization cost
Tangible fixed assets
110000 Land Undeveloped land
(not associated with a building)
Developed land
Other land
Land under capital lease
112000 Buildings Real estate improvements
(private driveways, walks, fences, parking
lots, sewers)
Manufacturing buildings
Administration buildings
Other buildings
Leasehold improvements
Buildings under capital lease
112500 Buildings AUC
113000 Other tangible assets LVA

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114000 Plant machinery and related Handling systems (robots)

equipment Machines for cold forming (stamping
machines, edging machines)
Machines for surface treatment (heat
treatment, plating equipment)
Machining equipment (turning machines,
drilling machines, milling machines)
Assembly machines (assembly lines)
Other plant machinery and related
equipment
Plant machinery and related equipment
under capital lease
114500 Plant machinery and related
equipment AUC
117000 Type specific tools
117500 Type specific tools AUC
115000 Operational equipment
115500 Operational equipment AUC
116000 Other Operational equipment Rented/Leased property installations
Fixtures and fittings
Office equipment
Hardware, mobile phones, fax
Testing instruments and measuring devices
Demonstration tools / pool (not intended to
be sold to customers)
Other operational equipment
Other operational equipment under capital
lease
118000 Vehicles Cars
Trucks (lorries)
Cars under capital lease


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Trucks (lorries) under capital lease

Means for internal transportation


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The current asset class structure shall meet all organisational requirements. The
asset classes are valid across all charts of depreciation (and all company codes). If
a particular company code feels the need for additional asset classes, these will
need to be approved centrally by the CPO Finance in conjunction with the
department FC in Schaan.
5.2 Master Data
5.2.1 Asset Master Record

The asset master record consists of two main parts:
General Master Data

This part of the master record contains concrete information about the fixed asset.
 General information (description, quantity, etc.)

 Account assignment
 Posting information (for example, capitalisation date)
 Time-dependent assignments (for example, cost center)
 Information for plant maintenance
 Entries for net worth tax
 Information on real estate
 Leasing conditions
 Investment support measures
 Information on the origins of the asset
 Physical inventory data
 Insurance data
 User fields/evaluation groups

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Data for Calculating Asset Values

Depreciation terms can be specified in the asset master record for each depreciation
area in the chart of depreciation. The master record contains an overview of the
depreciation areas. In addition, there is a detailed display available for each
depreciation area.
The following graphic shows the most important depreciation terms in a depreciation
area:
Picture 4 Depreciation terms (saphelp)
The asset number uniquely identifies a fixed asset. It always consists of the main
asset number and the asset sub-number.
Whenever there is an addition to an existing asset, it is recommended that a sub-
number be used, thereby simplifying inventory management and disposal
procedures.

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Number assignment is carried out internally. Internal number assignment means the
system automatically assigns consecutive numbers.
5.3 Business Processes
5.3.1 Asset Maintenance
5.3.1.1 Create an Asset

All proposed investments above the local low-value asset (LVA) maximum amount
require an investment application which must be approved by the cost centre
supervisor and budget controller (appropriate internal order) before the asset master
record can be created. Once this has been completed, purchasing can then initiate
the purchasing process.
Individual steps
Investment Applicant
Fills out the application form (further note should also be added if the asset life
should be different with that of the category and/or the activation date).
Supervisor/Cost Centre Manager
Approves (see corporate approval guidelines) or refuse investment application.
Budget Coordinator/Controller
Apply a particular internal order (available budget is then reduced) or refuse
application. If no budget position is available then no asset should be added
Asset Accountant
Opens master data based on the investment application using the asset category as
a guideline.
Purchasing

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Produce the purchase order on the basis of the asset number/internal order number
of an asset under construction. There are at least two different types of purchase
orders when ordering assets, namely an "A" for Asset or "F" for internal orders when
the investment will be first an asset under construction before being activated.
Transaction Code: AS01 create an asset master record

link to BPP
Transaction Code: AS11 create asset sub number
link to BPP
5.3.1.2 Asset Master Record Display

The asset master record contains all information relating to an asset.
Along with the Asset Explorer, the system provides the asset value display
transaction with extensive functions to analyse asset values.
Transaction Code: AS03 display asset master record

link to BPP
Transaction Code: AW01N asset explorer
link to BPP
5.3.1.3 Asset Master Record Change

Changes to an asset master record are done electronically using a separate form,
which needs to be authorised by the cost centre supervisor.
Changes may be necessary due to the following circumstances:
 Different Description / Location

 Change of Cost Centre
 Sundry Changes - e.g. to change the useful life

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Transaction Code: AS02 change asset master record

link to BPP
5.3.1.4 Asset Shutdown

If an asset is shut down for a given period of time, the depreciation can be
suspended (must be approved centrally by department FCG in Schaan).
When setting the shutdown indicator, the system does not calculate depreciation
during the time period of the shutdown (there is also no planned depreciation
amount for the entire fiscal year) and the useful life of the asset increases by this
length of time. When removing the shutdown indicator, the system automatically
resumes the calculation of depreciation.
Transaction Code: AS02 change asset master record

link to BPP
5.3.1.5 Mass Change

This is basically the same process as the asset master record change except that
notification is also given for the particular asset numbers through an attached file or
an excerpt from the asset schedule.
Mass asset change might be necessary for example in case of changes to the cost
center plan, when selling a large portion of the asset portfolio (mass retirement), or
due to changes at the asset class level. Changes at the asset class level affect only
those assets that are created after the change was made. Therefore, the already
existing assets have to be changed.
The mass change process has three levels:

 Defining the change rules
 Selecting the assets, and entering them in a worklist

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 Releasing the worklist
Transaction Code: OA02 mass change rule

link to BPP
Transaction Code: AR01 create an asset worklist
link to BPP
Transaction Code: AR31 edit an asset worklist
link to BPP
5.3.1.6 Lock Asset

To prevent future postings to an asset the blocking indicator in the asset master
record should be set (for example asset under construction once the project is
complete). Once the blocking indicator is set, it is no longer possible to post
acquisitions to this asset. Transfers and asset retirement postings to blocked fixed
assets are still possible.
Transaction Code: AS05 lock asset

link to BPP
5.3.1.7 Delete Asset

An asset master record to which no postings have been made can be deleted
physically from the database directly online, without archiving.
Transaction Code: AS06 delete asset

link to BPP
5.3.2 Asset Acquisitions

The primary business process in asset accounting is the purchase of assets and/or
the capitalisation of in-house produced goods or services.

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According to Hilti Group Finance Manual, assets acquisitions are posted gross (cash
discounts have no effect on the acquisition value) plus freight and handling charges
incurred.
In case the local legal requirements conflict with the above described, please
contact
the consolidation department in Schaan or the CPM for Finance and Controlling.
Cash Discount / Net Posting

When posting an asset acquisition integrated with Accounts Payable, the choice of
document type determines whether post gross (without cash discount deducted) or
net (with cash discount deducted). When using a document type for net posting
(RN = Invoice net, KN = Net vendors), the system determines the cash discount
deduction automatically by means of the specified terms of payment, and capitalises
the invoice amount on the fixed asset, minus sales tax and cash discount (cash
discount amount expected is already taken into consideration when the invoice is
posted).
Booking schema:
Clearing supplier Discounts loss

Asset Vendor discounts (net method) Bank account (net method)
GR/IR 290304
5114000 250000 190800 183000 858050
Goods receipt 10.000 10.000
Invoice receipt
(RN, KN) 200 10.000 10.000 200
Payment run
10.000 200 9.800
(realised cash discount)
Payment run
(lost cash discount) 10.000 200 10.000 200

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 For further information on how the cash discount is shown in the financial
statement (group and local version) please see chapter Financial Accounting
regarding Financial statement.
Acquisition without Purchase Order

..\..\..\Live_Documents\Finance\F_3_Fixed_Assets\Acquisition without PO.doc
5.3.2.1 Direct Capitalisation

Direct capitalisation refers to asset acquisitions that do not have an asset under
construction phase. Instead, they are capitalised and begin depreciation
immediately after receipt of the asset in the company.
Acquisition posted in Purchasing is the standard process by which assets are

usually acquired. Most of the actual processing takes place outside of the Fixed
Assets module, however the effects are reflected in this module.
External acquisition using a purchase order requires a sequence of steps to be
performed: (create the purchase order, post the goods receipt, and post the invoice
receipt).
Picture 5 Acquisition Posted in Purchasing (saphelp)

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Since the date of the goods receipt generally determines the moment the asset is
capitalised, the goods receipt is posted “valuated”.
Post “valuated” goods receipt means that the system capitalises the asset, creates
line items (a debit to the asset and a credit to the GR/IR clearing account), and
updates the value fields of the asset. The GR/IR clearing account is cleared when
the invoice receipt is posted. If there are differences between the amount posted
with goods receipt and the amount posted with invoice receipt the system
automatically corrects the acquisition and production costs (APC) amount on the
asset.
Booking schema:
Asset GR/IR Vendor Tax

5114000 290304 250000 164000
Goods receipt 10.000 10.000
Invoice receipt 10.000 12.000 2.000
 For further information on creating the purchase order and posting the goods
receipt please ask SCM-Team.
 For further information on posting the invoice receipt (credit memo) please
see chapter 4.2
5.3.2.2 Capitalise Asset under Construction

Assets under construction are acquisitions to fixed assets that are not permitted to
be capitalised and depreciated immediately.
An asset under construction has two stages in its life (under construction phase and
useful life phase). Depending on the phase that the asset is in, it has to be shown in
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different balance sheet items. Therefore, it is necessary to manage the asset as a

separate master record during the construction phase.
All acquisitions during the construction phase for an investment (internal hours,
stock material and external assembly costs) will be booked to an internal order
number range: XX9000000-XX9099999 (XX = Company identifier) and settled
periodically to the asset under construction.
During project phase there are defined milestones and the asset accountant and
project manager perform budget controls.
 When there is a deviation in schedule then the project manager needs to
authorise an extension or final closure.
 When the project budget is exceeded then the project manager needs to
apply for further funds.
On completion of the task (line-up), a final notification from the project manager to
the asset accountant is necessary to settle the asset under construction to one or
more assets. Those parts that do not require capitalisation (expense) can be settled
to cost centres
Once the asset under construction has been completely settled, the system
automatically deactivates the asset under construction.
The system status of the internal order has to be set manually.

 “technical complete” (postings are still allowed, open reservations will be
deleted)
 “closed” (postings are not allowed anymore)
Picture 6 Asset under construction

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Transaction Code: AIAB settlement AUC

link to BPP
Transaction Code: AIBU transfer AUC
link to BPP
Booking schema:
UNDER CONSTRUCTION PHASE USEFUL LIFE PHASE
Inventory
130000
Asset
Periodical Settlement 5114000
3.000
7.000
Internal Order AUC
1090XXXXX AUC
Material 5114200
300900 Material 300900
GR/IR 3.000 3.000 3.000 3.000
290304 Consultation
Invoice 666200 Consultation 666200
5.000 5.000 5.000 5.000 5.000 5.000
Capitalisation revenue of
910XXX
AUC 742000
2.000 2.000 2.000 2.000
Repair &
Maintenance
460200
Cost Centre
100800 3.000
Salaries
400000 2.000 2.000

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 For further information on creating the purchase order and posting the goods
receipt please contact the SCM-Team.
 For further information on enter goods issue please contact the SCM-Team
 For further information on posting the invoice receipt please see chapter 4.2.2
 For further information on orders for AUC please see chapter 7.2.9
 For further information on activity allocation please see chapter 7
5.3.2.3 Down Payments

Down payments represent a type of acquisition to fixed assets which has to be
shown in a separate balance sheet item.
The following transactions are required in connection with the down payment:
 Creating a down payment request
 Posting the down payment
 Posting the corresponding closing invoice
 Clearing the down payment with the closing invoice
Booking schema:

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1
Down Payment
AUC 5114200 Vendor 250000
1.000 1.000
Down Payment Down Payment

Acquisition 290976 116001
1.000 1.000
Down Payment
Clearing 290975 Bank 183001
1.000 1.000
2 Closing Invoice
AUC 5114200 Vendor 250000
1.000 1.000 20.000

20.000
AUC 5114200 Vendor 250000
20.000 20.000
3 Down Payment Clearing
AUC 5114200 Vendor 250000
1.000 1.000 1.000 20.000

20.000 1.000 1.000
Down Payment
Vendor 250000
Acquisition 290976
1.000 1.000 1.000 20.000
Down Payment
Down Payment
Clearing 290975
116001
1.000 1.000
1.000 1.000
 For further information on down payments please see chapter 4.4

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5.3.2.4 Subsequent Acquisition

A subsequent acquisition is an addition or enhancement to a capitalised asset.
Supplementary postings should be activated as a new sub-number.
As a result, the subsequent acquisitions can be depreciated and retired separately
from the main asset.
It may be necessary to change the depreciation terms (useful life of the asset) of the
new sub-number to be in line with useful life of the main asset.
5.3.2.5 Post-capitalisation
Post-capitalisation represents subsequent corrections to the acquisition and
production costs of a fixed asset. An example of when you need this type of
correction is if you neglected to add expenditures and costs linked with the
acquisition or assembly of an asset to its acquisition and production costs (APC)
in a fiscal year that is now closed.
A new asset master record for the post-capitalisation has to be created in the
following cases:
 A complete asset was forgotten to be capitalised.
 The asset amount for the post-capitalisation should have a different
capitalisation date than the asset that is already capitalised.
The system posts the historical acquisition and production costs (APC) as an
acquisition to the asset balance sheet account, and the accumulated depreciation
from past fiscal years (on the basis of the capitalisation date entered in the asset
master record) to the accumulated depreciation account.
Transaction Code: ABNAN post capitalisation

link to BPP

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Booking schema:
Accumulated
Asset Depreciation Depreciation
5114000 5114009 5470114
28.01.02 1.000 175 825
5.3.2.6 Credit Memos

A credit memo reduces the acquisition and production costs of an asset.
For credit memos received in invoice year the system automatically corrects the
depreciation in the next depreciation run.
When credit memos are received for a fiscal year that is already closed, the system
cannot correct the depreciation posted in the closed fiscal year. The extended
functionality within the Asset Accounting module allows the correction of
depreciation expensed in previous years to be corrected manually via write-up
before posting the credit memo or simply crediting depreciation within the current
period.
Transaction Code: ABGL credit memo in invoice year

link to BPP
Transaction Code: ABGF credit memo in next year
link to BPP
Booking schema:

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Asset Accrued Value Assets

5114000 290970
02.02.02 1.000 1.000
 For further information on credit memos integrated with a vendor please see
chapter 4
5.3.2.7 Write-up
A write-up is a later change to the valuation of an asset, when the
value adjustments (depreciation) calculated in the past were too high.
Excessive depreciation generally results from:
 The use of incorrect depreciation terms
 A later reduction in the acquisition and production costs of an asset
(e.g. due to a subsequent credit memo)
Transaction Code: ABZU write-up

link to BPP
Booking schema:
Accumulated Depreciation Depreciation

5114009 5470114
01.01.02 33 33
5.3.2.8 Low-Value Assets

In contrast to fixed assets of greater value, low value assets (LVAs) are completely
depreciated in the month of acquisition. Since they individually have little value, they

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are often managed collectively in a single asset master record. To activate collective
management a unit of quantity should be entered in the asset master record.
Quantity check (collective management)

A maximum amount (locally) is set for low value assets so that when the acquisition
is posted, the entire acquisition and production costs (APC) of the asset, divided by
the total quantity, are checked against the LVA maximum amount.
Low-value assets (LVAs) can also be posted directly to an expense account

470120 Low-value intangible assets
470121 Low-value tangible assets
Low-value assets have to be shown in the statement of fixed assets movements

(Frango) as increases and decreases in cost of acquisition and depreciation.
5.3.3 Asset Transfer
5.3.3.1 Intra-company Asset Transfer

A sending asset (or component of an asset) is transferred to a target asset within
the same company code required for one of the following reasons:
 An asset was created in the wrong asset class. Since it is not possible to
change the asset class in the asset master data, the asset has to be
transferred to a new master record.
 Split up an asset or move part of an asset (transfer from asset to asset).
Transfer posting from one fixed asset to another within the same company code can
be carried out in one step. The prerequisites, however, for automatic transfer-

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posting are that no values (APC and depreciation) from the sending asset are lost,
and that every area of the target asset is supplied with values.
Transaction Code: ABUMN intra-company transfer

link to BPP
Booking schema:
Accumulated Accumulated
Asset 1 Depreciation Asset 2 Depreciation
5114000 5114009 5114000 5114009
15.02.02 25.000 5.000 25.000 5.000
5.3.3.2 Inter-company Asset Transfer

A sending asset (or component of an asset) is transferred to a target asset that is
assigned to a different company code.
For the individual companies, an inter-company transfer represents a retirement for
one company and an acquisition for the other. From the point of view of the
corporate group, however, it typically represents a transfer that balances to zero in
the group asset history sheet. Inter-company transfers are always undertaken with
the corporate value for the acquisition cost of an asset less accumulated
depreciation.
There is a procedure by which the system will perform most of these steps
automatically. When using this procedure, only the transfer retirement in the sending
company code has to be posted manually. The system posts the transfer acquisition
in the receiving company code automatically

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It is important to note the following:

 Different Low Value Asset borders (capitalisation limits) exist in different
countries
 Asset master data for the residual useful life need to be checked
 In case of different currencies, the translation into the house currency is done
at the daily course of the invoice date
 Internal orders (AUC) have to be settled before transferring
An inter-company asset transfer within a corporate group may be necessary for one
of the following reasons:
 The physical location of the asset has changed, making it necessary to
assign the asset to a new company code.
 The organisational structure of the corporate group has changed, requiring to
re-assign the asset to a different company code.
There are two types of inter-company asset transfer:

 Transfer within one client (automatic inter-company transfer)
 Manual transfer (in two separate steps as a retirement and as an acquisition)
Intrer-company Asset Transfer Process

..\..\..\Live_Documents\Finance\F_3_Fixed_Assets\IC_fixedasset_transfer_PSP.doc
5.3.4 Asset Retirement

Asset retirement is the removal of an asset or part of an asset from the asset
portfolio. When an asset with several components (sub-numbers) is completely
retired, the sub-numbers can be posted in one step by entering an asterisk (*) in the
sub-number field. In this case sales revenue is proportionally allocated to the
individual sub-numbers according to their acquisition value.
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Depending on the business transaction that leads to the retirement, the following
types can be distinguished:
 An asset is sold, resulting in revenue being earned. The sale is posted with a
customer.
 An asset is sold, resulting in revenue being earned. The sale is posted
against a clearing account.
 An asset has to be scrapped, with no revenue earned.
If a new assets replaces an existing asset the new asset has to be booked for its full
value, and the old asset has to be disposed of through a credit memo.
5.3.4.1 Asset Sale with customer

The process of asset disposal with a known customer is completed wholly in
Accounts Receivable (A/R). Several bookings are automatically posted to reflect the
sale (customer / revenue) and the disposal of the asset (acquisition cost,
accumulated depreciation and gain/loss on asset disposal).
If the buyer is a one-time customer and if it is not worth to create a customer in the
customer master, a special one-time customer account, only for assets (account
group = ZASS, customer = ASSET), should be used, because of a different
reconciliation account (164900 - not influencing turnover).
Individual steps:
Requestor
Requestor fills out the form "Change of Asset" (electronically) which needs to be
authorised by the cost centre supervisor, and also ensures that all the appropriate
spare parts are disposed.
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Purchasing
The Purchasing department looks for an interested party to by the asset, negotiates
a sales price (within “free sale” means, that the sales price is CHF 1.00 or
appropriate currency), organises postage and packaging and informs the cost centre
manager and asset accounting.
Asset accounting
Asset accounting issues a manual invoice with the negociated amount (asset
number is present on the invoice). At the moment of posting the invoice a number
will be issued, which is copied automatically by the system into the field “Reference”
on the invoice document (document header). This document number will have to be
written down manually on the paper invoice.
The profit from asset sale will be the difference between net book value and sales
price (negotiated amount).
Transaction Code: FD01 create asset one-time customer

link to BPP
Transaction Code: F-92 asset retirement with customer
link to BPP
Transaction Code: F-92 asset retirement with one-time customer
link to BPP
Booking schema:
Retirement of an asset with an acquisition and production cost of 5.000 that was
sold for 3.000. Due to accumulated depreciation of 1.250, the net book value at
retirement is 3.750, resulting in a loss of 750.

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5.3.4.2 Asset Retirement by Scrapping

This removal of an asset from the asset portfolio is a retirement without any revenue
(by scrapping). The system does not create revenue and gain/loss postings, instead
it creates a loss from an asset retirement without revenue posting in the amount of
the net book value being retired.
Individual steps:
Requestor
Requestor fills out the form "Change of Asset" (electronically) which needs to be
authorised by the cost centre supervisor, and also ensures that all the appropriate
spare parts are disposed.
Purchasing

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Purchasing searches for a buyer and when one isn't found then the disposal is
handled as a scrapping (“gift” means also to be handled as a scrapping). Purchasing
informs the cost centre manager and asset accounting.
Asset accounting
Asset accounting books the scrap with the form "Change of Asset" as the basis
document.
Transaction Code: ABAVN asset retirement by scrapping

link to BPP
Booking schema:
Accumulated
Asset Depreciation Gain/Loss
5114000 5114009 5690000
28.02.02 10.000 9.000 1.000
5.3.4.3 Subsequent Revenue/Costs

It is sometimes necessary to post revenue or costs for an asset retirement that has
already been posted. For example, for an insurance benefit as subsequent revenue
to an asset, although the asset has already been scrapped (deactivated).
However, when using this method, there is no integration with Financial Accounting
(or Controlling), although it is needed for AA reporting in the standard retirement list.
This means that the costs or revenue have to be posted again explicitly in Financial
Accounting in order to create a corresponding posting document (CO document).
Transaction Code: ABNE subsequent revenue

link to BPP
Transaction Code: ABNK subsequent costs

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link to BPP
5.3.5 Display / Change Document

Documents that have already been posted can be displayed and entries which need
to be adjusted can be changed. All document changes are logged and can be
displayed in the document overview.
Transaction Code: AB03 display document

link to BPP
Transaction Code: AB02 change document
link to BPP
5.3.6 Reverse Document

To reverse a particular transaction, the reversal needs to occur in the module that
the transaction originated. For instance an invoice receipt needs to be reversed in
MM and not AA. Also, when there are several transactions that are required to be
reversed, it is necessary to reverse all the transactions that had been completed in
the reverse order to which they had originally been made.
Transaction Code: AIST reverse capitalise AUC

link to BPP
Transaction Code: AB08 reverse other asset document
link to BPP
5.4 Periodic Processing
5.4.1 Periodic Posting

Currently, online automatic posting to Financial Accounting is only possible for one
depreciation area (01 book depreciation). To create different balance sheet versions
(consolidated balance sheet) it is necessary that changes to asset balance sheet
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values (transactions) be posted to the respective G/L accounts on a periodic basis.

To be able to do this, clearing accounts are necessary (see also posting scheme at
the end of this paragraph).
Clearing accounts (book depreciation)
 990005 Asset disposal clearing
 990010 Revenue from disposal clearing
The system uses the account 990005 “asset disposal clearing” to clear the net
revenue (without sales tax) which results from asset sales. The offsetting account
for this clearing account is the account 990010 "revenue from disposal clearing"
(entering during the retirement posting). The system uses this revenue/revenue
clearing posting with its zero balance to internally determine gain/loss without sales
tax.
Clearing accounts (consolidated balance sheet)

 990000 Asset acquisition clearing
 990001 Asset disposal clearing
 990010 Revenue from disposal clearing
The system uses the account 990001 “asset disposal clearing” to clear the net
revenue (without sales tax) which results from asset sales. The offsetting account
for this clearing account is the account 990010 "revenue from disposal clearing"
(entering during the retirement posting). The system uses this revenue/revenue
clearing posting with its zero balance to internally determine gain/loss without sales
tax. The account 990000 “asset acquisition clearing” is the contra account for the
asset acquisition and asset retirement postings (vendor and customer) and will not
be considered for analyses. It serves only the reconciliation of the different values
between book depreciation and consolidated balance sheet.
Booking schema:

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1 Acquisition with vendor

2 Depreciation run
3 Retirement with customer (sale to customer with revenue)
4 Acquisition with vendor
5 Depreciation run
Book depreciation
Balance Sheet Profit and loss statement Clearing accounts
Vendor Expense depreciation

F/A 5114000 Revenue from disposal clearing
250000 5470114
990010
1 1.000 3 1.000 1 1.000 2 500 3 1.500
4 500 4
500 5 250
Accumulated depreciation Customer Gain / Loss on disposals Asset disposal clearing

5114009 150000 5690000 990005
3 500 2 500 3 1.500 3 1.000 3 1.000 3 500
5 250 3 1.000
Consolidated balance sheet
Balance Sheet Profit and loss statement Clearing accounts
Expense depreciation Asset acquisition clearing

F/A 114000 470114 990000
1 1.000 3 1.000 2 250 1 1.000
4 500 5 125 4
500
Accumulated depreciation Gain / Loss on disposals Asset disposal clearing

114009 690000 990001
3 250 2 250 3 750 3 1.000 3 250
5 125 3 750
Transaction Code: ASKB periodic posting

link to BPP

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5.4.2 Posting Depreciation

The calculation and scheduling of depreciation are automatically controlled by keys
in the system. Planned depreciation from Asset Accounting, must be periodically
posted to the corresponding asset and expense accounts in the general ledger.
The system creates posting sessions with the respective bookings per depreciation
area and account group in accordance with the posting cycles.
The posting process uses the catch-up method, which means that the system
calculates depreciation over again from the start of the year up to and including the
depreciation period now being posted. The difference between this amount and the
total depreciation already posted is the new depreciation amount that is posted.
Assumptions before the depreciation run

 all documents from the current month have been booked
 assets under construction that need to be activated, have been activated
 changes to assets have been completed
Handling of errors during depreciation posting

Various handling errors can appear when the batch-input session is created for the
posting of depreciation, or when the session is processed for Financial Accounting.
Checks during the posting run

 The system checks the posting period that has been entered. For a regular
posting run, the posting period must follow the last posting period in
chronological order.
 The system runs a plausibility check on the depreciation amounts to be
posted. If an error is discovered, this does not lead to a termination of the
posting program. The system continues to create the batch-input session,
and lists the assets with errors, along with the cause of the error, in the report
log. The depreciation amounts for the assets with errors are not included in

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the batch-input session. After making the necessary corrections post the
depreciation for these assets to Financial Accounting through a repeat run.
 The system checks the existence of the G/L accounts to be posted. If the
system finds a G/L account that is not defined, it terminates processing. After
making the required corrections restart the program using the restart option.
The program then continues processing in the asset database from the point
at which it previously terminated. The program creates a new, complete
posting session, including the data in the session that was terminated.
If the first session still exists in the system in the status "Create", delete it.
Do not process this incorrect session under any circumstances.
If errors cause a termination of the batch input session while it is processing, or if

the session is accidentally deleted, recreate the batch input session through
recreate session. In this case, the system only recreates those documents that were
not already posted.
After the depreciation run is completed successfully, the current period should be
blocked, and the subsequent period opened.
Transaction Code: AFAB depreciation run

link to BPP
Transaction Code: AFBD recreate session
link to BPP

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Booking schema:
Asset Accounting
book consolidated cost-accounting

depreciation balance sheet depreciation
Ordinary depreciation 3.500 2.000 2.000
Additional account assignment Cost centre
Financial Accounting
Depreciation Expense Depreciation Expense Depreciation Expense

5470114 470114 470999
3.500 2.000 2.000
Accumulated Accumulated Accumulated

Depreciation 5114009 Depreciation 114009 Depreciation 470998
3.500 2.000 2.000
Controlling
Cost centre 100800

2.000

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Recalculate Values
It might be necessary to recalculate planned annual depreciation (only for fiscal
years that are still open) if:
 depreciation keys have been changed

 mass changes relevant to depreciation have been made
The depreciation posting program corrects the periodic depreciation for the fiscal
year. To determine this depreciation, the system uses the newly calculated annual
depreciation and the periodic depreciation that has already been posted.
Transaction Code: AFAR Recalculate values

link to BPP
5.4.3 Fiscal Year Change

A fiscal year change is the opening of a new fiscal year for a company code. At the
fiscal year change, the asset values from the previous fiscal year are carried forward
cumulatively into the new fiscal year. Once the new fiscal year has been opened it is
possible to post in both the new and old fiscal year.
Transaction Code: AJRW asset fiscal year change

link to BPP
5.4.4 Account Reconciliation

Each posting to a subledger account causes an automatic balance change in a G/L
account. The reconciliation program lists any possible differences between the asset
values (summarised on G/L account level) and the G/L accounts.
If the accounts are shown twice with the identical amount, once with “zero”in the
column period and once with “999” in the column period plus “W004” in the column
doc.no this means it is only a warning and no error. There is no action necessary.

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Transaction Code: ABST2 account reconciliation

link to BPP
5.4.5 Year-end Closing

The year-end closing program is used to close the fiscal year for a company code
from an accounting perspective. Once the fiscal year has been closed, it is no longer
possible to post or change values within Asset Accounting.
Controls during year-end closing process

The system only closes a fiscal year in a company code if
 The system has found no errors during the calculation of depreciation
(e.g. incorrectly defined depreciation keys).
 Planned depreciation from the automatic posting area has been completely
posted to the general ledger.
 Balances from depreciation areas that are posted periodically have been
completely posted to the general ledger.
 All assets acquired in the fiscal year have already been capitalised.
(Since this check does not make sense for assets under construction, prevent
this check from being made for assets under construction by means of the
asset class).
 All incomplete assets (master records) have been completed.
 All insurance index series for the year being closed have been correctly
updated
Transaction Code: AJAB asset year end closing

Link to BPP:
..\..\..\Live_Documents\Finance\H2_Transactions_BPP\BPP_H20_AJAB_asset year
end closing.doc
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5.4.6 Insurance Values

It is necessary to create the insurance values at least per asset category per
location by entering the index (from a government body).
The base insurable value (updated at year-end closing) is always stored for the last
closed fiscal year in the asset master record.
Insurance type
The insurance type contains control parameters for determining insurable values
(value as new insurance and the depreciation area to be used). Value as new
insurance means that the acquisition and production costs (APC) are used for the
calculation of the insurance value.
The naming convention for the Insurance type is as follows:

Total two digits (for example H1)
Second position is an ascending number
Index series
The index series specifies that the index figures are year-dependent and the
calculation of indexed values is based on historical acquisition and production costs
(APC). Year-dependent means that “x” figures relate to the fiscal year, and show a
rate of change in relation to a certain base year (the base year has the index figure
100).
When using historical calculation, the insurance value is determined as if the
subsequent acquisition took place in the capitalisation year.
The naming convention for the Index series is as follows:

Total five digits (for example HAT10, HAT1A)

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Second and third position (two letters) are the country identifier (AT = Austria)
Fourth position is an ascending number (for example 1 = number to differentiate
various company codes in the same country)
Fifth digit is an ascending number or letter (for example 0 = index for a group of
asset classes e.g. land). The group of asset classes and also the character may
vary
from company code to company code.
Transaction Code: OAV5 (S_ALR_87009182) maintain index series

link to BPP
5.4.7 Physical Inventory

A physical inventory is the recording of the quantities and amounts relating to the
asset portfolio. The inventory is lead by the cost centre manager and an inventory
must occur for every asset at least every three years (normally undertaken before
the budgeting process). Any differences need to be justified and approved by the
cost centre manager before they are undertaken within the asset accounting.
Undertake the inventory without Barcode

Asset accounting creates the inventory lists (containing the relevant master data
fields) and distributes them to cost centre manager carrying out the inventory
Relevant master data fields are:

 Asset number with sub-number
 Quantity
 Description
 Location
 Cost centre
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 Acquisition and production costs (APC) / net book value

 Capitalisation date
 Requestor or owner
Cost centre managers undertake the inventory in the following way:
 Existing assets need to be crossed off from the list
 Assets that are on the list but are actually belonging to another cost centre or
have been disposed of need to be noted.
 Note on the inventory list assets that exist but are not on the list (asset
number, cost centre, description, and further remarks)
 Location (for insurance purposes) also needs to be checked and corrected
when necessary.
Asset accounting then works through the list and undertakes the following processes
when necessary:
 Change cost centre
 Change description
 Change location
 Post asset retirement
 Post asset acquisition (reactivate asset)
Asset accounting then enters the inventory date in the asset master data
Processing an asset inventory with a barcode

Asset accounting creates the inventory lists (containing the relevant master data
fields) and distributes them to cost centre manager carrying out the inventory.
Relevant master data fields are:

 Asset number with sub-number
 Quantity

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 Description
 Location
 Cost centre
 Acquisition and production costs (APC) / net book value
 Capitalisation date
 Requestor or owner
Cost centre managers then lead the inventory using the barcode system.
Depending on the various possible results of the inventory, there are several
possible scenarios:
 The inventory results match the fixed assets data.
 The results of the inventory are not the same as in fixed assets. For example,
an asset is at a location different from the one stored in fixed assets.
 The inventory does not find the fixed asset.
 The inventory finds fixed assets that were not recorded at all in fixed assets.
Asset accounting imports the data from the barcode system (interface) and then re-
creates the inventory list to determine any found differences.
The inventory report with the differences is then re-sended to the cost centre
manager for approval.
Cost centre manager justifies the differences e.g. stolen, disposed, sold or
transferred.
Asset accounting finalises the reports by undertaking the following processes when
necessary:
 Change cost centre
 Change description
 Change location
 Post asset retirement

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 Post asset acquisition (reactivate asset)
Asset accounting inserts the inventory date in the asset master data
Place asset numbers (country specific)
Asset accounting starts a monthly or weekly report for asset additions with location
code. The asset number (and barcode when using) is then placed on the asset itself
through the asset accountant or cost centre owner.
Another possibility could be to place the asset number (and barcode if using one)
with distribution (depending on local requirements).
5.5 Reporting
5.5.1 Reports on Asset Accounting

The Information System for Asset Accounting is defined in the form of a report
selection tree and contains a series of standard reports, as well as functions for
modification to meet specific needs. By double clicking on a totals line, it is possible
to get a detailed list of all the assets that make up the total.
SAP supplies the following standard queries for Asset Accounting:
Asset Balances
 Balance lists (by asset number, by asset class, by cost centre,...)
 Inventory list (by cost centre, by asset class, by location,...)
Notes to Financial Statements
 Asset History Sheet (most important report for the year-end closing)
Explanations for the Profit and Loss Statement
 Depreciation (per asset and posting period)
 Depreciation comparison
Cost Accounting
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 Posted depreciation (related to cost centre)

 Revaluation and backlog
Depreciation forecast
 Depreciation simulation
 Depreciation current year
Specific Valuations
 Insurance Values
Preparations for closing
 Asset Transactions
 Asset Portfolio (current book value)
 G/L Account Balances
Day-to-day Activities
 Asset acquisitions
 Asset retirements
 Asset transfer
 Directory of re-postedunposted assets
 List of origins by cost elements
Taxes
 Total depreciation
5.6 Investment Plan (Budgeting)

The most important task of investment program is to manage approved budget
values for a given time period.
Budget values are different from plan values in regard to how binding they are. In
the planning phase, the costs are estimated as exactly as possible. In the approval
phase, the funds are supplied in the form of the budget, which is thereby binding.

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Management approval is required to increase investment plan, although it is

possible to transfer various budget positions within the group structure via an
electronic application form.
If a budget position is not used in a particular fiscal year then it is not carried over to
the next fiscal year, but needs to be separately planned for, if it has to be retained.
Projects that run over multiple years need to be split in the various planned fiscal
years for budgeting purposes.
Every individual company is responsible for their own investment plan, and upon
local approval it is rolled-up to a group level for final approval.
The hierarchical structure of the investment plan is carried over from Controlling
(CO).
If there are changes in the organisational structure, capitalised assets and internal
orders should be transferred (change cost centre and set “valid from date”) during
the planning phase.
5.6.1 Internal Order

During internal order planning, costs and activities are entered which are expected
to incur during the life cycle of an order. It is possible to make the entry directly per
asset or total per cost centre and asset class. By using percentage distribution rules,
it is possible to distribute planned depreciation for a planned capital investment to
asset classes and start-up dates.
Statistical Orders (Type XX12)

Statistical orders, unlike “real” orders, are not settled to, costs that are posted to
them are simply for information purposes only. Statistical orders are needed by
asset accounting for the availability control, and thus the budgeting process is the
same as a normal order but the process of assignment between internal order and
asset are different. The statistical order is assigned to the asset in the asset master
data upon creation of the asset. When the purchase order is created for the asset,

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SAP automatically ensures that there is sufficient open budget for the new outlay. If
there is no budget available then a new internal order needs to be assigned to the
asset or further funds need to be allocated to the internal order (normally from
another internal order).
Capital investment orders (Type XX90)

Capital investment orders are used to plan assets under construction (AUC), and in
terms of availability control they have exactly the same functionality as the statistical
internal orders. The differences lie in the assignment between the internal order and
the asset. Specific expenses that are due to be capitalised at period-end are
collected temporarily on the internal order. At least once a period the asset
accountant or responsible manager needs to check the expenses on the internal
order to determine whether they should really be capitalised or not. Those expenses
that shouldn’t be capitalised need to be re-posted to their correct account and cost
centre, while the remaining amount is then settled to the asset under construction.
Here, lies the difference between a real internal order (XX90) and a statistical order
(XX12) as the assignment to the asset under construction is made at settlement
(through the settlement rule) and not at the creation of the asset master. It is vital
that there is at least one settlement per month per real internal order otherwise the
expenses per cost centre will be incorrect.
 For further information on internal orders please see chapter 7.2.9
5.6.2 Order status

The current status of an internal order determines which business transactions can
be performed.
There are four different states:
Created
In this status, for example, actual postings are not possible.

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Released
Nearly all business transactions are allowed in this status.
Technically completed
In this status, for example, no planning changes are possible.
Closed
In this status, for example, no cost-relevant business transactions are allowed.
Once the system status of an internal order is set to “closed” it is still possible to
reactivate the internal order, by resetting to “technically completed”.
5.6.3 Depreciation simulation

For primary cost planning related to cost center accounting, a forecast of future
depreciation is needed. Depreciation siumlation is not only carried out for assets that
are already capitalised, but also for planned capital investments (in the form of
internal orders). For capitalised assets, the future depreciation is forecasted on the
basis of the acquisition and production costs (APC) and the depreciation terms
entered for the asset. For planned investments, the future depreciation is forecasted
on the basis of the plan values, the depreciation terms of the asset class used and
the planned start-up date entered.
The organisation concerned decides how they wish to structure their internal orders.
It is possible to make them as broad as possible, so that there is one internal order
per cost centre per asset class. Alternatively, if such detail is considered too
complex in the planning phase, then an internal order could be created for a cost
centre group (e.g. finance) for all asset classes, and the depreciation simulation can
then be run only on the cost centre group level. Alternatively, it is possible to provide
more than one cost centre per internal order to create the depreciation simulation if
that particular level of detail is needed. The main point to consider here is to plan on
the level which will be used to compare budget to outlays during the financial year.

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Picture 6 Depreciation simulation

CAPITALISED ASSETS
Date of Depreciation
Asset class Cost centre APC
capitalisation 2003
114000 100600 01.03.2002 20.000 2.500
116000 100700 15.05.2002 15.000 3.000
118000 100800 28.07.2002 100.000 33.000
PLANNED RETIREMENTS
Date of Depreciation
Asset class Cost centre
retirement
APC
2003
PLANNED
DEPRECIATION
112000 100900 30.06.2003 - 1.500.000 37.500 2003
2.500
3.000
REMAINING BUDGET 2002
33.000
Date of Remaining Depreciation
Asset class Cost centre
capitalisation budget 2003 37.500
114000 100700 01.02.2003 200.000 20.000
20.000
116000 100703 01.06.2003 60.000 10.000
10.000
117000 100800 01.09.2003 15.000 5.000
5.000
COMMITMENTS 2002 11.000
Cost centre Date of Depreciation 11.250

Asset class APC
capitalisation 2003
20.800
116000 100700 27.02.2003 80.000 11.000
1.000
BUDGET 2003
Asset class Date of Depreciation
Cost centre Planned APC
capitalisation 2003
114000 120.000 11.250
100600 01.03.2003
116000 250.000 20.800
100803 01.06.2003
117000 40.000 1.000
100900 01.12.2003

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Individual steps
Set controlling area
For controlling area-dependent settings, the R/3 System requests to set the
controlling area (HI01).
Set planner profile

The planner profile (HILTICO), together with the planning area in Overhead Cost
Controlling, determines the planning layout used in planning.
Create internal order

There is a need to collect and analyse actual and planned costs related to a specific
event.
Transaction Code: KO01 create internal order
link to BPP
Transaction Code: KO02 change internal order
link to BPP
Planning cost elements

There is a need to perform cost element/activity input planning for internal order.
Transaction Code: KPF6 change cost and activity inputs
link to BPP
Budgeting
There is a need to track fund appropriations against actual spending for an event.
Transaction Code: KO22 change original budget
link to BPP

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Cost Planning
There is a need to forecast future depreciation for primary cost planning related to
cost center accounting.
Transaction Code: S_ALR_87099918 primary cost planning depreciation
link to BPP
5.6.4 Disinvestments
Planned disinvestments need to be also entered per cost centre per month basis.
Assets that have an acquisition value of less than CHF 50.000 (or the equivalent in
local currency) do not need to be planned.
Depreciation
The depreciation amounts for planned retirements are only calculated up to the
planned retirement date of the asset (entered in asset master data).
Gain/Loss Disposal
The expected profit or loss of the retirement should be entered on cost element
690000 (cost centre of the asset disposed).
 For further information on change of cost and activity inputs please see
chapter 7
5.6.5 Availability control

Availability control prevents exceeding the budget as soon as it occurs. When
entering an activity, such as a purchase order, which is assigned to an internal
order, the system checks whether the budget available (and released) is sufficient.
The system uses tolerance limits both above and below the actual budget amount.
If, for example, the purchase order value exceeds the budget, thereby lead into a
budget overrun, the system reacts accordingly (purchase order blocked).

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Cost element category 90 (balance sheet accounts in FI-AA)

Cost elements of category 90 enable the controlling of the costs of an order budget
during the acquisition of fixed assets. In Controlling, orders are debited statistically.
This statistical debit is checked with the budget during the availability control.
5.6.6 Budget update

During the planning phase the budget from previous years should be revised.
To record where supplements, returns, and transfers came from and where they
went to, budget documents for internal orders (enter texts if needed) are created.
In addition the planned capitalisation date for an investment should be updated by
changing the internal order master data.
The following types of budget update can occur:

Return budget
That means to return any surplus funds.
Transaction Code: KO26 return budget
link to BPP
Transaction Code: KO27 display budget return
link to BPP
Transfer budget
That means to return budget on one side (internal order) and to supplement budget
on the other.
Transaction Code: KO26 return budget
link to BPP
Transaction Code: KO27 display budget return
link to BPP
Transaction Code: KO24 supplement budget
link to BPP

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Transaction Code: KO25 display supplement budget

link to BPP
Change budget
It is also possible to make budget updates using the change function.
Transaction Code: KO22 change original budget
link to BPP
Transaction Code: KO23 display original budget
link to BPP
Display budget document

Transaction Code: KO2B display budget document
link to BPP
Transaction Code: KO2A change budget document
link to BPP
5.6.7 Budget conclusion

In mid-December the budget of the current year is closed, which means no further
investments can be made. At the same time the “new” budget is released for
purchasing.
To prevent further calculation of depreciation simulation, the internal order status of
the internal order (current year) should be set to “Closed”.
If there are budget commitments posted to an internal order it is not possible to set
the status to “Closed”. In that case, the status should be set first to “Technically
completed” or the remaining parts of a budget of the internal order will be deleted by
the asset accountant.

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5.7 Investment Management
5.7.1 Integration
re-posted
The Investment Management (IM) component provides functions to support the
planning for capital investments, such as the acquisition of fixed assets as the result
of in-house production or purchase.

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5.7.2 Components within Investment Management
 Investment Program
 Appropriation Requests
 Investment Measures
5.7.2.1 Investment Program

The investment program represents the planned and budgeted costs for the capital
investments in the form of a hierarchical structure (cost centre hierarchy of CO).
The investment program is managed only in controlling area currency (CHF).
Budget values are different from plan values in regard to how binding they are. In
the planning phase, the costs are estimated as exactly as possible. In the approval
phase, the funds are supplied in the form of the budget, which is thereby more
binding.
A specific fiscal year as the approval year for a program has to be assigned.
Approval year means that the program has values that were approved in this year
(but not necessarily for this year only). The key and the approval year together
uniquely identify an investment program.
Within the hierarchy of the investment program, the costs for capital investments are
planned via appropriation requests (bottom up and seasonal).
If a budget position is not used in a particular fiscal year then it is not carried over to
the next fiscal year, but needs to be separately planned for, if it has to be retained.
Projects that run over multiple years need to be split in the various planned fiscal
years for budgeting purposes.

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Every individual company is responsible for their own investment plan, and upon
local approval it is rolled-up to a group level for final approval.
The naming convention for an investment program is as follows:

Total seven digits (for example 1051-IM)
First four positions are the company code
Fifth position is a dash
Sixth and seventh positions are “IM” for Investment management.
5.7.2.2 Appropriation Requests

The Appropriation Requests component supports the investment process in the
phase concerned with planning (bottom up) and making decisions about
investments to be implemented.
Appropriation requests are a kind of noted item for proposed investments. They
have extensive master data, in which information relevant to the investment can be
entered. In addition, appropriation requests perform profitability analysis.
In many cases, there are a number of alternatives for fulfilling an appropriation

request. These can be of a technical or fiscal nature. Fiscal alternatives could be
different methods of procurement (purchase, leasing or in-house production).
Therefore, appropriation request variants exist for every appropriation request. Each
appropriation request has to have at least one appropriation request variant.
In order to be able to determine plan values for an investment program with the
highest degree of accuracy, it is necessary to assign the appropriation requests to
an investment program and to an investment program position (mandatory fields).
Assignment is only possible to the lowest positions in the hierarchy (also called end
nodes). End nodes are the program positions with no positions below them.

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The organisation concerned decides how they wish to structure their appropriation
requests. It is possible to make them as broad as possible, so that there is one
appropriation request per asset (required for type specific tools) or one appropriation
request per cost centre per asset class.
Alternatively, it is possible to provide more than one cost centre per appropriation
request to create the depreciation simulation if that particular level of detail is
needed.
The main point to consider here is to plan on the level which will be used to compare
budget to outlays during the financial year.
5.7.2.2.1 Status Management

The Status Management represents different phases in the life of an appropriation
request
Transaction Code: IMA11 create appropriation request
link to BPP

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5.7.2.2.2 Roll up Plan Values in the Investment Program

For planning the investment program as a whole, you have to roll up the plan values
of the individual appropriation requests that belong to it.
Transaction Code: IM34 default plan values
link to BPP
5.7.2.2.3 Edit Original Budget

Once planning is finished, the next step is the budgeting process. During this
process, you prescribe the funds available in the form of a budget (copied from plan
values).
Transaction Code IM32 edit original budget
link to BPP
5.7.2.3 Investment Measure

Once it is approved, the appropriation request enters the implementation phase, in
which it is actually carried out. Here a measure for the actual implementation of the
appropriation request is used. The measures that are allowed at this time are
internal orders. The measure can be created directly from master data maintenance
for the appropriation request.
Transaction Code: IMA11 edit appropriation request

link to BPP

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5.7.2.3.1 Internal Order
Statistical Orders (Type XX12)

Statistical orders, unlike “real” orders, are not settled to, costs that are posted to
them are simply for information purposes only. Statistical orders are needed by
asset accounting for the availability control, and thus the budgeting process is the
same as a normal order but the process of assignment between internal order and
asset are different. The statistical order is assigned to the asset in the asset master
data upon creation of the asset. When the purchase order is created for the asset,
SAP automatically ensures that there is sufficient open budget for the new outlay. If
there is no budget available then a new internal order needs to be assigned to the
asset or further funds need to be allocated to the internal order (normally from
another internal order).
Capital investment orders (Type XX90)

Capital investment orders are used to plan assets under construction (AUC), and in
terms of availability control they have exactly the same functionality as the statistical
internal orders. The differences lie in the assignment between the internal order and
the asset. Specific expenses that are due to be capitalised at period-end are
collected temporarily on the internal order. At least once a period the asset
accountant or responsible manager needs to check the expenses on the internal
order to determine whether they should really be capitalised or not. Those expenses
that shouldn’t be capitalised need to be re-posted to their correct account and cost
centre, while the remaining amount is then settled to the asset under construction.
Here, lies the difference between a real internal order (XX90) and a statistical order
(XX12) as the assignment to the asset under construction is made at settlement
(through the settlement rule) and not at the creation of the asset master. It is vital
that there is at least one settlement per month per real internal order otherwise the
expenses per cost centre will be incorrect.

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 For further information on internal orders please see chapter 7.2.9
5.7.2.3.1 Order status

The current status of an internal order determines which business transactions can
be performed.
There are four different states:
Created
In this status, for example, actual postings are not possible.
Released
Nearly all business transactions are allowed in this status.
Technically completed
In this status, for example, no planning changes are possible.
Closed
In this status, for example, no cost-relevant business transactions are allowed.
Once the system status of an internal order is set to “closed” it is still possible to
reactivate the internal order, by resetting to “technically completed”.
Verweis auf Leitfaden Projekt Controlling

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Global Process Management System

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Process: F-3 Fixed Assets Fixed Assets

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets

5.6.5 Availability control................................................................................................................ 52

Date Who What Release

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Process: F-3 Fixed Assets Fixed Assets

5.1 Organisation and organisational data

5.1.1 Depreciation Area

Table 1 Depreciation areas

Picture 1 Depreciation areas (saphelp)

Process: F-3 Fixed Assets Fixed Assets

Depreciation areas are grouped in a chart of depreciation according to local

5.1.2 Chart of Depreciation

The naming convention for a chart of depreciation is as follows:

5.1.3 Asset Class

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Process: F-3 Fixed Assets Fixed Assets

Picture 2 Asset classes (saphelp)

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets

Picture 3 Account determination

Naming Convention is a 6-digit name

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets

Table 2 Asset classes

Process: F-3 Fixed Assets Fixed Assets

114000 Plant machinery and related Handling systems (robots)

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets

Trucks (lorries) under capital lease

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets

5.2 Master Data

5.2.1 Asset Master Record

General Master Data

 General information (description, quantity, etc.)

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets

Data for Calculating Asset Values

Picture 4 Depreciation terms (saphelp)

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets

5.3 Business Processes

5.3.1 Asset Maintenance

5.3.1.1 Create an Asset

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets

Transaction Code: AS01 create an asset master record

5.3.1.2 Asset Master Record Display

Transaction Code: AS03 display asset master record

5.3.1.3 Asset Master Record Change

 Different Description / Location

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets

Transaction Code: AS02 change asset master record

5.3.1.4 Asset Shutdown

Transaction Code: AS02 change asset master record

5.3.1.5 Mass Change

The mass change process has three levels:

Valid on day of print 18/05/2004 20:01:00 - For internal use only -

Process: F-3 Fixed Assets Fixed Assets